March 2020, Vol. 247, No. 3


INGAA Chairman ‘Bullish’ on Natural Gas Pipeline Activity for 2020

Longtime industry veteran Stanley “Stan” G. Chapman, III has been selected by the Board of Directors of INGAA to serve as the organization’s chairman. 

Chapman, who brings a wealth of knowledge to his position, is responsible for all pipeline operations and commercial activities across TC Energy’s FERC-regulated transmission and storage assets, as well as its unregulated midstream business. Prior to TC Energy, Chapman served as Columbia Pipeline Group’s (CPG) executive vice president and chief commercial officer before CPG was acquired by TC Energy in July 2016.  

He holds a bachelor’s degree in economics from Texas A&M University, as well as a master’s degree in business administration from the University of St. Thomas.

As INGAA celebrates its 75th anniversary, Chapman took time out to talk with P&GJ about his top priorities for his term, progress on INGAA safety initiatives, regulatory hurdles and other topics. 


P&GJ: Tell us a little about your background and what led you to a career in the pipeline industry?  

Chapman: As Executive Vice President and President of TC Energy’s U.S. Natural Gas business and Chairman of TC Pipelines GP, I oversee the company’s 31,000-mile network of FERC-regulated transmission pipelines and its 535 Bcf of natural gas storage. 

Our assets in the U.S. span coast-to-coast, traverse across 40 states and transport approximately one quarter of the natural gas consumed each day in the U.S. TC Energy (“TC”) is a premier energy infrastructure company in North America with over 57,500 miles of natural gas pipelines, 3,000 miles of liquids pipelines and 6,000 megawatts of power.

Prior to TC Energy, I was Executive Vice President and Chief Commercial Officer of Columbia Pipeline Group, until it was acquired by TC in 2016. I have been in the natural gas pipeline business for over 30 years. My formal education in finance and economics taught me about allocative efficiencies and allocating scarce resources across unlimited human wants.

Applying this knowledge to the energy sector, where our nation’s resources are quite extensive, but still finite, intrigued me because people everywhere continue to demand reliable and affordable energy. 

What our industry does – producing, processing, and transporting natural gas and related energy products to commercial and residential consumers – drives our nation’s economy. It creates high-paying jobs; reduces energy costs for millions of individuals; creates energy independence for our country; fosters our national security interests domestically and for our allies abroad; and lifts people across the world out of poverty. Knowing that our team of dedicated employees at TC plays a critical role in each of these not only makes me proud, but it’s what gets me excited about coming to work each day. 


P&GJ: What do you consider INGAA’s biggest priorities during your term as chairman?

Chapman: INGAA has adopted the following priorities for this year: 

  • Promote the role of natural gas infrastructure as a foundation of our nation’s energy economy.
  • Emphasize the essential role of natural gas and natural gas infrastructure in achieving national and global environmental goals.
  • Protect the statutory and regulatory framework that facilitates a vibrant, market-responsive interstate natural gas pipeline industry.
  • Protect the reliability and resilience of the interstate natural gas pipeline network.
  • Promote pipeline safety solutions that embrace risk management, technology and innovation; and promote natural gas infrastructure permitting predictability.

As an industry, we need to be better advocates for what we do for the nation. Natural gas is more than a so-called “bridge fuel.” It’s an essential, efficient, and abundant natural resource that supports innumerable aspects of our daily lives. Without cleaner burning natural gas displacing coal, our nation would not have seen a 15% reduction in its CO2 emissions from 2005 to 2017. 

Without having reliable and plentiful natural gas supplies available to support renewable electricity generation, we would not have seen such strong growth in that sector. We need to promote the fact that our future is one of natural gas and renewables, not natural gas or renewables. 

According to the Energy Information Administration, natural gas and other conventional fuels will still account for about 80% of our nation’s energy supply by 2050, with the greatest growth on an absolute value basis belonging to natural gas. Clearly, natural gas and the pipeline infrastructure needed to move it throughout the county, is going to remain a critical part of our energy future.


P&GJ: Where do you expect the majority of construction to take place over the next two or three years? What type of projects will most of those be?

Chapman: We have an abundance of supply across the US and Canada, and growing demand in many key markets. For example, there is over 200 Bcf of associated gas that can be produced at a cost of zero dollars. Much of this is in the Permian and the Bakken shale plays. Developing new infrastructure in those regions will not only help get gas to market, it will also reduce the need to flare gas, which will help significantly reduce GHG emissions. 

Generally speaking, across the midstream sector, I believe the industry will likely transition to smaller, compression driven, in-corridor expansion projects as opposed to the long-haul, multibillion-dollar greenfield pipeline expansions we’ve seen over the past several years. 

As far as location goes, LNG exports continue to drive demand as U.S. production now has access to world markets. Many of these expansions are likely targeted at new terminals proposed or being constructed on the U.S. gulf coast and across North America’s west coast. 

U.S. LNG exports are a key driver in reducing GHG emissions worldwide as much of it will be consumed by growing economies throughout Asia, which historically have relied on coal and other heavier polluting fuel sources. Additionally, as Permian production grows and demand for energy in Mexico continues to mature, I think we’ll see more opportunities for new infrastructure both from Texas to Mexico and within Mexico itself. Although USMCA is a positive step toward providing us with greater confidence in continued investment in Mexico, we are watchful for other signals from the Mexican government that can help us decide on future opportunities.


P&GJ: Overall, how positive is your outlook for the natural gas pipeline business during 2020?

Chapman: Despite some headwinds, natural gas is essential to not only current everyday life, but to achieve the clean energy goals of the future. This fact gives me good reason to be bullish, both for 2020 and beyond. We have a role and obligation to society to meet the needs of the public, our shippers and the millions of businesses – small and big – to deliver the energy and building blocks they need so that their plant keeps running, their home stays warm and their businesses provide the goods and services upon which so many of us rely. 

There is strong bipartisan support for natural gas, including the infrastructure necessary to deliver it to consumers. By 2050, global natural gas demand is projected to increase by more than 40%, and the United States is projected to become the world’s largest exporter of liquefied natural gas within the next five years. The U.S. needs natural gas infrastructure – both new construction and modernization of existing infrastructure – to ensure our nation’s plentiful supplies of natural gas can reach consumers across the country and abroad.


P&GJ: Do companies seem to be having success in raising investment capital for new infrastructure projects?

Chapman: While each individual company may have its own nuances, generally speaking, yes. Access to capital via public debt or equity issuances, or via private equity, generally remains liquid across the midstream sector. There is a need for infrastructure, and the capital is available.


P&GJ: What are the biggest regulatory obstacles facing INGAA members concerning development of pipeline projects?

Chapman: It’s no secret that building new linear energy infrastructure has becoming more difficult in the current environment. I’m not sure the public knows how rigorous the environmental review process for new infrastructure is today. When I first started in the industry three decades ago, it took a few months to get a FERC certificate so that construction could commence. 

Today, it routinely takes 15 months or longer to obtain a FERC certificate. That timeframe doesn’t even account for 12 months or so that companies spend working with landowners and environmental agencies to refine a pipeline route before formally applying for a permit with FERC. The environmental review and permitting process is a very important part of a pipeline project. INGAA works hard to ensure that this review process is efficient and predictable so we can deliver the energy the country needs in a timely manner. 

In addition, the fact that pipeline safety reauthorization has stalled in Congress is a big concern for our members, and I worry that we risk losing the momentum we have generated over the past several years. Congress passed major reauthorization bills in 2012 and 2016. PHMSA followed those with significant new regulations, which amount to the biggest improvement to the pipeline safety program since its inception.

Until a reauthorization bill is signed into law, important opportunities to further advance pipeline safety will be stalled. Pipeline safety has been, and should remain, a non-partisan issue. We hope the House and Senate will work together to develop a proposal that will continue the recent safety gains we’ve had. 


P&GJ: What progress has been made concerning INGAA’s safety initiatives?

Chapman: Safety is central and core to our member companies’ operations. Each and every day we have scores of employees and contractors who are exclusively focused on pipeline safety and integrity management. Safety is everyone’s job – including mine. 

In 2011, INGAA adopted a series of safety principles and commitments called the “Integrity Management – Continuous Improvement” (IMCI) Program. Since then, our members have made great strides in integrating these measures into their day to day activities and enhancing operational safety.

In addition, INGAA conducted its third safety culture survey during 2019. INGAA conducted surveys in 2013 and 2016, but 2019 was the first time that the survey was conducted jointly by INGAA and the Canadian Energy Pipeline Association (CEPA). Measuring the safety culture of an organization reveals employees’ perceptions of organizational safety policies and procedures, the strength of an organization’s commitment to safety, and how leaders within the organization respond to safety violations. Conducting these surveys has allowed INGAA members to identify areas for improvement and take proactive steps to reduce safety risks.


P&GJ: How has INGAA addressed the need for strategic communications in order to head off opposition to new pipelines and related infrastructure?

Chapman: Our industry needs to more clearly explain the benefits we deliver for the country, which might require us to step out of our comfort zone, liking touting our contribution to reducing greenhouse gases. I welcome the conversation because I’m proud of what our members do to deliver natural gas and the associated economic and environmental benefits this energy source provides our nation and the world. 

We recognize that we must do a better job of communicating our success stories. For example, INGAA recently released data showing that methane emissions from large compressors were reduced by 23% from 2011 to 2017, even though throughput increased 26% over that same timeframe. That’s great news, and something we need to promote more often.

Additionally, many INGAA member companies participate in voluntary programs intended to further reduce methane emissions, like the ONE Future Coalition which has far exceeded even its own ambitious goals to reduce emissions. ONE Future companies are committed to achieving a science-based average rate of methane emissions across their facilities equivalent to 1 percent (or less) of total natural gas production. The ONE Future companies surpassed this mark when it registered a 2018 methane intensity number of 0.326%, a decrease of 41% from its 2017 number of 0.552%.

That’s a big part of what we at INGAA do on behalf of our members – promoting our industry and ensuring that policymakers understand the positive role natural gas and related infrastructure plays in meeting energy demand in an environmentally responsible manner. The better we communicate the value and positive impacts of our industry, the more effective we’ll be at addressing the challenges with constructive public policies.


P&GJ: What do INGAA members express as their greatest concerns about the coming year?

Chapman: INGAA members want to be sure that our nation’s policymakers fully appreciate the tremendously beneficial role that natural gas plays in our daily lives. Not too long ago, our nation was worried about declining supplies of energy. Prices were high and dependence on foreign countries for our energy was a major concern. In a short time, the natural gas sector has been able to turn that around. 

Prices are low and jobs are being created. We’re leading the world in environmental improvements and we’re exporting gas to allies and key trading partners across the world. A stable and predictable regulatory, legislative and judicial environment is a critical part of building on this success. We hope Congress and the states will keep that in mind. 


P&GJ: What would you most like to see accomplished during your term as chairman?

Chapman: On the policy side, it is critical that pipeline safety reauthorization occurs as soon as possible. As I mentioned, we’ve made tremendous strides recently in pipeline safety. I hope we can build on that progress with legislation that helps incentivize the use of new technologies and processes now available to the pipeline industry to ensure the continued safe and reliable delivery of natural gas.

On the advocacy side, we need to improve how we communicate and promote what we do for the nation. America’s natural gas transmission industry ensures the safe, reliable and efficient delivery of a critical energy source. 

The fact that we create warm, comfortable spaces when it’s cold, cool habitable spaces when it’s hot, and provide the feedstock for much of the products used in society is truly remarkable. During my time as chairman, it’s my goal to get more members engaged in this dialogue. Natural gas and the infrastructure that delivers it are deeply interwoven into our economy. We must do a better job telling this important story. 

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